Midday Update Wednesday, April 03, 2019

Corn: Corn futures are trading with minor gains today, moving higher, but without much urgency. May corn is up 1-1/2 cents to 3.63, Jul corn is up 1-3/4 cents to 3.72-1/2, and new crop Dec corn is up 1-3/4 to 3.91-1/4. Optimism about U.S./China trade negotiations is helping keep some support today, but the U.S./Mexico border conflict is keeping buying action somewhat subdued. Brazil and Argentina FOB corn offers are currently about 3.00 cheaper than U.S. corn. There will be a few rain events over the next handful of days in the Midwest, and the second half of next week will bring another round of soaking rains to the Midwest. Temperatures should be about average for the weekend, then cool to below average next week. Dec corn futures traded as high this morning as 3.92-3/4, but have since fallen back to just nearly positive gains. During yesterday’s session, funds sold 5,000 contracts of corn and are thought to be net short about 242,000 contracts.

Soybeans: Soybean futures are steady to lower this morning, with May beans down 1/4 of a cent to 8.99-3/4, Jul down 1/4 of a cent to 9.13-1/4, and new crop Nov beans are steady at 9.32-3/4. Trading ranges today have been very tight, with Nov beans trading only as high as 9.35-3/4 and as low as 9.31. Prices are currently trapped between their 10 and 20-day moving average levels without much new happening fundamentally to keep the week’s momentum moving higher at this point. Still, speculative shorts may begin to exit on positive trade news. During yesterday’s session, funds bought about 4,000 contracts of beans and are thought to be net short about 51,000 contracts.

Wheat: Wheat markets are mixed this morning, with May Chi wheat up 3 cents to 4.67, May KC wheat up 1/4 of a cent to 4.33-1/2, and May Mpls wheat down 7 to 5.34-3/4. Open interest in KC wheat is at its highest levels since January 2018, which may suggest that funds are increasing their already net short position. Japan bought 120,000 tons of wheat from the U.S. and Canada yesterday, but later on they cut tariffs on imports under trans-Pacific and EU accords. This will give Australian and Canadian wheat exports a 15.70 per ton advantage over U.S. supplies. Winter wheat futures are testing overhead resistance levels again this morning, but have yet to make significant movement through them. Meanwhile, Mpls and spring wheat futures continue to fall with forecasts for better spring weather. During yesterday’s session, funds bought about 2,000 contracts of wheat in Chi and are now thought to be net short about 68,000 contracts.

Cattle: Cattle markets are slightly lower this morning, again testing nearby support levels with talk of lower cash movement this week. Apr lives are down 25 cents to 126.02, Jun lives are down 37 cents to 119.27, and Aug lives are down 27 cents to 115.97. Apr feeders are down 52 cents to 144.32, and May feeders are down 50 cents to 147.30. Forecasts are showing weather forecasts likely to improving feedlot conditions over the near term, and beef values have been slipping lately. As of last Tuesday, funds were holding a record net long position, despite liquidation from there, live cattle futures have been able to hold nearby support levels.



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